Caitlin Long, CEO of crypto bank Custodia, has criticized the US government for its handling of a massive crypto fraud that occurred months before the company collapsed. She made the comments about her in a blog post after disclosing evidence to police. Long’s post followed Custody’s unsuccessful application to become a member of the Federal Reserve System, which was denied by the Federal Reserve Board.
Custody CEO Slams US Govt For ‘Shooting Messenger Who Warned About Crypto Debacle’
Digital currency and blockchain company executives are upset with the US government’s crackdown and lack of regulatory clarity. Brian Armstrong, CEO of Coinbase, has called on Congress to pass clear legislation on cryptocurrencies, and Jesse Powell, CEO of Kraken, has echoed that message. On February 17, caitlin longCEO of Custody, published a blog post explaining that he had given evidence to authorities about a crypto fraud case months before the company collapsed, leaving his millions of customers at a loss.
In his blog post titled “Shame on Washington, DC for Shooting Courier Who Warned About Crypto Debacle,” Long argues that current enforcement actions are a misguided crackdown on the entire industry. “Calls to crack down today are coming from many of the same policymakers who were charmed by the scammers,” Long wrote. It is well known that senior members of the US Securities and Exchange Commission (SEC), the White House and the Commodity Futures Trading Commission (CFTC) met with Sam Bankman-Fried (SBF) and officials high range of FTX.
Additionally, it is estimated one in three members Congress received a direct contribution from SBF and his inner circle. “In a 180 degree turn, (lawmakers) are now throwing out the baby with the bathwater,” Long wrote on his blog. The Custody CEO also mentioned that government officials compared the operation of his crypto bank to the misconduct and collapse of FTX, which resulted in the officials ambushing the crypto industry.
“Custodia Bank recently found itself in the crosshairs of Beltway Politics at its worst,” Long emphasized. “Custodia was simultaneously attacked by the White House, the Federal Reserve Board of Governors, the Kansas City Federal Reserve and Senator Dick Durbin (who combined our 100% liquid and solvent unleveraged bank with FTX in a speech in the senatein which he attacked two companies run by female CEOs, Fidelity and Custodia, implicitly comparing us to a 29-year-old accused con man who now wears an ankle bracelet).
Custody’s CEO added:
Custody sought to be regulated by the federal government, the very result that bipartisan politicians claim to want. However, Custody has been denied and is now looked down on for daring to walk through the front door.
After Long blogged about the situation, Jesse Powell, CEO of Kraken, answered to his Twitter thread on the subject. “I can’t tell you how infuriating it is to have flagged massive red flags and obviously illegal activity to regulators only to have them ignore the issues for years,” Powell tweeted. “’They’re out at sea. It’s complicated. We are looking at everyone. DURING YEARS. Then to be used as his example.”
The complaints by Long, Armstrong and Powell come after the SEC’s enforcement action against Terraform Labs and CEO Do Kwon, nine months after the collapse of the entire Terra ecosystem. The US securities regulator was criticized for being late to the gameand many believe the SEC is simply throwing spaghetti at a wall to see what sticks.
What is your take on the Custody CEO’s criticism of the US government’s handling of recent enforcement actions in the cryptocurrency industry and the red flags he flagged prior to the collapse of a cryptocurrency industry? cryptocurrency company? Share his thoughts on this subject in the comments section below.
image credits: Shutterstock, Pixabay, Wiki Commons
Disclaimer: This article is for informational purposes only. It is not a direct offer or a solicitation of an offer to buy or sell, or a recommendation or endorsement of any product, service or company. bitcoin.com does not provide investment, tax, legal or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.
